Tracker mortgage scandal highlights need to put ethics and people at the center of the social market economy – McGuinness

The Tracker mortgage scandal in Ireland highlights the need for banks and institutions to act ethically and morally in their business activities and put the needs of European citizens to the fore in rethinking Europe, First Vice-President of the European Parliament Mairead McGuinness MEP said at a high-level conference of leading European voices in Rome, Italy on Friday. The meeting on Christian’s contributions on the future of Europe heard contributions from McGuinness and Frans Timmermans, First Vice-President of the European Commission, European Parliament President Antonio Tajani and Manfred Weber, Chair of the EPP Group.

“The tracker mortgage scandal is a perfect example of how banks and supervisory bodies failed to do the right thing by customers – even today, after the worst of the economic crisis may have abated. Have the banks learned nothing from the past when trust in them and in our regulatory systems was diminished in the eyes of citizens left to carry the can? The actions of banks during the economic collapse showed that ethical behaviour was non-existent with the result that many ordinary citizens lost pensions, homes, livelihoods and Hope. Faith in our economic system has been tarnished.”

Addressing the theme of “What kind of Economy for Europe in a changing world”, McGuinness called for an economy that is people-centred, built on solid foundations of diversity, and based on sustainability criteria taking climate change, resource efficiency, respect of nature and biodiversity into account. Not one that is based on wanton consumption.

“Pope John Paul II in 1991 said that the Free Market is the most efficient instrument for utilising resources and efficiently responding to needs. But His Holiness qualified that by saying that there are many human needs which find no place in the market and many people without the purchasing power to meet those needs through the market.

The widening gulf between the few excessively rich and the many painfully poor was evident from an Oxfam report showing that eight billionaires own the same amount of wealth as the poorest half of the world’s population – 3.6 billion people. This stark fact must propel us towards a world that allows for enterprise but also allows for fairness in rewarding enterprise, according to the Fine Gael MEP.

“The balance between capital and labour has shifted. Just today we read of exploitation of workers in the agriculture sector in Europe – those who provide our daily bread. Such exploitation is unacceptable in our Europe today and these sharp practices must be addressed, so those most invisible in society – those who care, who clean, who gather and grow are afforded the same dignity and respect as others in more high profile and higher paying roles.

“The future European economy must be fit for purpose, regulated, responsive and provide opportunities for all, including education, housing, health care and support . We are talking about a social market economy,” MEP McGuinness said in Rome.

Growing fears about globalisation must be listened to and responded to by putting in place safeguards. Many of the world’s poorest have been lifted from poverty by globalisation, but many in Europe see it as a threat to their way of life.

“Rapid advances in technology are also shaping our society, our politics and our democracy”, she said.

“Robust and accountable institutions are essential both within the EU and outside. We need an economic model that is greater than statistical analysis about return on investment. It must be a model which puts economic growth at the service of society. Through fair taxation, with corporations contributing their fair share in order to provide social supports.

“Increasingly, the squeezed middle are concerned that they carry an unfair burden of taxation and are demanding a rebalancing. Society needs an open and robust debate about rights and responsibilities – of society in general and the individual role in society. Wealth need to be created to provide money for social support system. Wealth also needs to be redistributed – so that the balance between capital and labour is the right one. Fairness, morality and ethics must be part of the conversation,” McGuinness said in meetings involving Cardinal Reinhard Marx, President of the Commission of the Bishops’ Conferences of the European Community (COMECE) and others.

Vice-President McGuinness will represent the Parliament at an evening prayer service with the community of Sant’Egidio in the Church Sta. Maria in Trastevere and attend a private audience with Pope Francis at the Vatican on Saturday.